Bitcoin’s inability to hold above $40,000 has traders now targeting extreme lows in the $25,000 zone, a move
Bitcoin’s inability to hold above $40,000 has traders now targeting extreme lows in the $25,000 zone, a move that would be absolutely deadly for most altcoins.
The U.S. dollar index (DXY) turned down from its 20-year high on April 29 but that has not changed the bearish price action seen in Bitcoin (BTC) and U.S. equity markets. Equities remain under pressure and this week Amazon stock saw its biggest intraday drop since 2014 after uncertainty over the U.S. Federal Reserve’s tightening measures placed investor sentiment back into choppy waters.
If Bitcoin extends its correction, on-chain analysis platform Whalemap believes that the $25,000 to $27,000 zone may be the best place “to go all in” on Bitcoin.
Long-term investors do not appear to be panicking over the current weakness in Bitcoin and on-chain data from CryptoQuant shows that the combined BTC reserves of 21 crypto exchanges has plummeted to levels not seen since September 2018.
The HODL mentality is not limited to Bitcoin investors alone. A nonfungible token survey report by CoinGecko showed that more than 50% of respondents said they have a HODL mentality because they believe NFTs could be important items in games. The report added that the Metaverse could become an $800 billion market in the next two years.
Could Bitcoin and altcoins decline further or is a reversal on the cards? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin pulled back to the 20-day exponential moving average ($40,363) on April 28 but the long wick on the day’s candlestick suggests that bears are selling on rallies to this level.
The downsloping 20-day EMA and the relative strength index (RSI) below 41 indicate that the path of least resistance is to the downside. If bears sink and sustain the price below the support line of the channel, the BTC/USDT pair could extend its decline to $34,300 and later to $32,917.
To invalidate this negative view, the buyers will have to push and sustain the price above the 50-day simple moving average ($41,981). If they succeed, the pair could start its northward journey to the 200-day SMA ($47,433) where the bears may again pose a stiff challenge.
ETH/USDT
Ether (ETH) pulled back to the 20-day EMA ($2,991) in the past two days but the bulls could not push the price above it. This suggests that the sentiment remains negative and traders are selling on rallies.
The bears will now attempt to sink the price to the uptrend line. This is an important level for the bulls to defend because a break and close below it could invalidate the developing ascending triangle pattern. The ETH/USDT pair could then decline to $2,450.
This negative view could invalidate in the short term if the price turns up and breaks above the 50-day SMA ($3,045). That could attract buyers who may then push the pair to the 200-day SMA ($3,464). A break and close above this level could signal the start of a new up-move.
BNB/USDT
Binance Coin (BNB) dropped below $391 on April 26 but the bears could not sustain the lower levels. The price rose back above the breakdown level on April 27. This suggests demand at lower levels.
The bulls pushed the price to the 50-day SMA ($410) on April 28 but could not clear this hurdle. This suggests that bears are selling on rallies. The bears will now attempt to pull the price below the $391 to $380 support zone.
If they manage to do that, the BNB/USDT pair could drop to the strong support at $350. The buyers are expected to mount a strong defense at this level. The short-term trend could turn positive if bulls push and sustain the price above the 50-day SMA.
SOL/USDT
Solana (SOL) bounced off the support line of the ascending channel on April 27 but the bulls could not sustain the positive momentum and clear the overhead hurdle at the 20-day EMA ($101).
The bears now sense an opportunity and will try to sink the price below the support line of the channel. If they manage to do that, the selling could accelerate and the SOL/USDT pair could slide to the strong support at $75. This is an important level for the bulls to defend because a break and close below it could signal the resumption of the downtrend.
This negative view could invalidate in the short term if the price turns up and breaks above the 20-day EMA. The pair could then rise to $110 and later attempt a rally to $122.
LUNA/USDT
The failure of the bulls to push Terra’s LUNA token above the psychological resistance at $100 could have tempted short-term traders to book profits. That has pulled the price below the minor support at $86 today.
The RSI has dipped into the negative zone, indicating that the bullish momentum has weakened. If…
cointelegraph.com